New Mexico seeks damages from Wells Fargo over fake accounts scandal

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New Mexico Attorney General Hector Balderas announced Wednesday the state is seeking damages from Wells Fargo on behalf of thousands of residents who were victimized by the bank’s fake account scandal.

An investigation by Balderas’ office found that the bank’s corporate management pressured employees to “put profits over people,” which led them to open millions of unauthorized accounts. Balderas said the business model was based on a high-pressure tactic known as “cross-selling” where employees faced job loss or other consequences if they failed to meet demanding quotas to enroll customers in more and more products – whether the customers needed them or not.

According to the attorney general’s figures, Wells Fargo is the largest bank in New Mexico, with 93 branches doing approximately $9 billion of business in the state.

Balderas said the bank knew about the alleged sales practice, but did nothing to stop employee behavior. “The fake accounts generated fees for Wells Fargo, padding its bottom line while New Mexican families paid the price,” he said. “New Mexicans could have been paying for groceries, clothes, or college savings, but were instead hit with illegal fees, draining their bank accounts and damaging their credit scores.”